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Beyond the Budget spin: some news on important medicines policy changes

Croakey is closed for summer holidays and will resume publishing in the week of 9 January 2023. In the meantime, we are re-publishing some of our top articles from 2022.

This article was first published on Wednesday, April 6, 2022.


Introduction by Croakey: On Budget night, the Treasurer spoke for some paragraphs about developments in medicines policy. He said the Government had approved more than 2,800 new or amended listings on the Pharmaceutical Benefits Scheme, “nearly one per day”, and announced the listing of a treatment for a rare form of breast cancer.

Health Minister Greg Hunt also has quite a history of promoting PBS listings, and the Health Department Budget announcements did likewise.

How very strange then that we have heard so little about a shift in medicines policy that was not-quite-revealed in Budget papers and that merits wider debate and discussion. Associate Professor Lesley Russell investigates.


Lesley Russell writes:

It always takes a while for the devilish details of the Federal Budget to emerge and often when they do there is every reason to believe that they were deliberately made obscure to avoid upfront explanations about the logic and the funding that underpins them.

This week a classic example of this obfuscation has emerged: the National Prescribing Service (NPS) MedicineWise program, which has had a two-decade long role as the steward of the Quality Use of Medicines (QUM) program that is an integral part of the National Medicines Policy, has been de-funded.

That specific fact is actually not found in the Budget Papers and has not been mentioned by the Prime Minister, the Treasurer or the Health Minister.

It is hidden in an element of the Health Budget initiative labelled, somewhat misleadingly, “Guaranteeing Medicare – Strengthening Primary Care” – a raft of provisions, costed at $230.7 million over five years, that purports to be the Morrison Government’s response to the 10-Year Primary Health Care Plan 2022-2032.

A dot point blandly outlines the allocation of “$5.7 million over 7 years from 2021-22 to redesign the existing Quality Use of Diagnostics, Therapeutics and Pathology Fund to support the appropriate use of medicines” (see Budget Paper #2 page 67).

The implications of this measure for NPS MedicineWise were only revealed after Budget night by several on-line newsletters that cater to the pharmaceutical industry and are only available to subscribers.

This restructure of the way that programs to educate medical professionals and consumers about the best way to use medicines and prevent their wasteful or inappropriate use are developed, managed, implemented and evaluated is not necessarily a bad thing. A list of pros and cons could be drawn up.

But major impediments to the future of the QUM program include that:

  • this comes ahead of the release of the (now delayed) National Medicines Policy Review
  • it is now apparently seen as only an issue for primary care when QUM is important across the healthcare system/s (especially acute care, aged care, mental health services)
  • more than twenty years of NPS expertise will likely be lost
  • the funding and staff to do this work is reduced.

The work once done by NPS MedicineWise will be done under the auspices of the Australian Commission on Safety and Quality in Health Care (ACSQHC). This is a well-respected body that has always worked in coordination with NPS and whose remit includes the issues of evidence-based use of medicines.

But it appears that even as the ACSQHC assumes these new responsibilities, its own budget has been cut.

Digging deeper

Here is an outline of what I have been able to learn about this budget decision, together with some background about the NPS MedicineWise program.

NPS MedicineWise has been the official government-funded steward of QUM since it was established in 1998. Stakeholders had identified a need for coordinated and independent prescribing support services and for this reason NPS was incorporated as an independent company, not a part of government. You can read more about the history here in a paper on the achievements over the first twenty years of operation.

The NPS receives most of its income from the Australian Government and is required to show savings achieved for the Pharmaceutical Benefits Scheme and Medicare. Over more than twenty years it has received over $500 million in Federal Government funding; this investment has saved  the Government more than $1 billion.

Perhaps the writing was already on the wall for NPS MedicineWise in the 2018-19 Federal Budget, which offered the security of four years of funding at the expense of requiring “more efficient delivery of services” to deliver savings of $40.0 million over the forward estimates (see 2018-19 Budget Paper #2, page 113).

Despite this reduction, NPS MedicineWise’s core Commonwealth funding is still significant. The organisation’s 2021 report indicates that revenue for operating activities for 2021 was $30.4 million, of which $23.8 million was from the DoH.

In that same Budget, there was a separate measure for targeted education activities to improve the use of biological anti-rheumatic drugs (expensive to the PBS) and blood and blood products which aimed to achieve savings of $77.6 million over five years (see 2018-19 Budget paper #2, page 114).

This effort, known as the Value in Prescribing  program, is administered by NPS MedicineWise under an agreement with the Department of Health.

The Government also indicated at that time that it would review the delivery of the QUM Program by NPS MedicineWise. The review of NPS MedicineWise was led by Professor Lloyd Sansom and his report was delivered in December 2019. While lauding the work done, it also had some serious criticisms.

These included the need for: greater transparency and accountability in performance reporting; more meaningful engagement with the “QUM ecosystem” including earlier and more frequent engagement with the DoH, ACSQHC, the RACGP and PHNs; and a revision of the way PBS and Medicare savings are reported in line with Department of Finance guidelines.

To quote: “The Review’s stakeholder consultations highlighted a view that NPS MedicineWise is withdrawing from its national QUM stewardship responsibilities: increasingly adopting a transactional rather than relational approach to its QUM programs; reducing collaboration and limiting the flow of information about its programs. This is resulting in a lack of co-ordination and duplication of effort.”

Stakeholders also expressed concerns that the organisation was too focused on achieving savings at the expense of public health outcomes. Here I have to say that this almost certainly represents NPS MedicineWise responding to pressures (via funding and targets) from DoH; simply put, achieving savings was pushed by the Government as core business.

More seriously, there were concerns about the commercial use of data from MedicineInsight, a national longitudinal general practice dataset run by NPS MedicineWise.

In response to the review, Health Minister Greg Hunt stated in April 2020: “The Review found that NPS MedicineWise produces high quality and valuable programs and resources linked to quality use of medicines and the support of patients. ….  The Review found almost universal acknowledgement that NPS MedicineWise’s activities should continue to be supported by the Commonwealth.

“We are working with NPS MedicineWise to implement the Review’s recommendations.”

However, it appears that NPS MedicineWise was given no forward warning that it would not be funded into the future, that the stewardship of QUM will be moved to the ACSQHC, and that it will then be forced to compete on a project-by-project basis for government-funded medical education related to QUM.

NPS MedicineWise will be funded to deliver the current QUM program until the end of 2022.

The explanatory papers accompanying the Health Budget say this:

“After this time [1 January 2023] a redesigned program will fund the Australian Commission on Safety and Quality in Health Care to deliver stewardship of quality use of medicines and therapeutics in the Australian health care system, supplemented by competitive grant processes to fund projects to deliver health professional education and consumer education and health literacy around quality use of medicines and tests. An additional $3.9 million in funding will be provided to support the improved and expanded program. ”

Questions and concerns

It is not clear what will happen to the Choosing Wisely Australia program, which is also operated by NPS MedicineWise.

The ACSQHC is a statutory agency within the Department of Health that reports to the Parliament and Health Minister. It lists priority areas as the safe delivery of healthcare, partnering with consumers and healthcare professionals, as well as quality, value and outcomes. It does excellent work and has previously worked closely with NPS MedicineWise.

Without casting dispersions on the work of the Commission, I see three key problems with this move:

  1. The QUM work is no longer independent of government and the DoH.
  2. My investigations show that ACSQHC resources are being cut over the forward estimates, even as it takes on this new work.
  3. There was no consultation around this decision, which I would argue should have been made in the context of the NMP Review.

The Commission receives some funding from State and Territory Governments and consequently its annual program of work is supposedly developed in consultation with State and Territory Health Ministers.  Were they consulted on this issue?

The information available on the ACSQHC resources in the 2022-2023 DoH Portfolio Budget Statement indicates that Commonwealth funding for the Commission will decline over the forward estimates (see Table – data from 2022-23 DoH PBS Table 2.1).

There is no predicted increase in ACSQHC staffing levels (86 in 2021-2022 to 88 in 2022-2023).

As an aside – and regardless of what is happening with the QUM programs – it seems illogical that the resources of an agency like ACSQHC should be eroded, given that top-of-mind issues like the pandemic, climate change, anti-microbial resistance and workforce shortages all serve to heighten the importance of ensuring safety and quality in healthcare services.

The DOH Portfolio Budget Statement also outlines the full funding provided to ACSQHC for the initiative to redesign the current Quality Use of Diagnostics, Therapeutics and Pathology Fund.

It is not clear if the funding provided in the forward estimates ($9.34 million per year) is for implementation measures and, if so, the extent to which this would represent a cut in funding for QUM.

NPS MedicineWise released a public statement on the proposed changes on 6 April. It states that:

The NPS MedicineWise model of a national implementation body at arm’s length from government remains as important today as it was 24 years ago. Our track record demonstrates the success of this approach to achieving national policy objectives, improved prescribing and health outcomes, consumers as partners in their healthcare, and PBS and MBS sustainability.

NPS MedicineWise is having ongoing discussions with the Australian Government Department of Health to better understand the decision and implications for the organisation.”

What to conclude about this?

On one hand, given what we know about the Morrison Government’s lack of commitment to evidence-based, consumer-focussed services, this appears to be a short-sighted decision based on savings achieved.

At first blush, it’s up there with decisions to cancel the Bettering the Evaluation and Care of Health (BEACH) program and the Australian Primary Health Care Institute (APHCRI).

But it might be a sensible transfer of responsibilities to an established agency already working in this space – or it would be, if we can be reassured that resources and expertise will also be transferred and not lost, and that there is no loss of impetus with the important work currently underway under the auspices of NPS MedicineWise.

The quality and safe use of medicines is listed as a National Health Priority (it was added as the tenth priority after consideration by COAG in 2019).

As such, it is imperative that it has the resources and support needed for its role in improving Australians’ health outcomes.


See Croakey’s archive of stories on safety and quality in healthcare.


Declaration from Croakey Health Media: Croakey Professional Services is working with the ACSQHC on a series of sponsored content on healthcare safety and quality issues. Croakey Conference News Service has previously covered NPS MedicineWise events.